Chris Ruane
Main Page: Chris Ruane (Labour - Vale of Clwyd)Energy Price Freeze
Chris Ruane Excerpts
Dr Whitehead
The Secretary of State has been waving a document around. Can he turn to the page in that document that discusses netting off between companies in the long-term market? Can he turn to the page in that document that discusses the question of creating trades at time of closure by companies? If he cannot do so, will he accept that the document is not quite the panacea for all the transparency issues that he thinks it is? Will he go away and review the things that the document does not say as well as what it does say about the transparency of the market?
Mr Davey
I am going to answer the question. When the hon. Member for Southampton, Test reads this paper, he will know that it is in a series of papers and other papers deal with those issues. The relevant paragraph—it does not deal with netting off, but it deals with the impact of netting off—is on page 7. The right hon. Member for Don Valley should like this, because we have some agreement on the need to make sure there is competition in the wholesale markets. It states:
“It could also encourage business models that reduce the need to trade in the wholesale market, such as vertical integration and long-term contracts. Poor liquidity therefore inhibits competition between incumbent players in the market.”
In other words, we need these proposals so that there is more competition in the forward markets so that new entrants can come in and the prices that the incumbents charge are more transparent—something that the right hon. Lady says that she wants to see.
Gregory Barker
The hon. Gentleman is absolutely wrong. He confuses the number of people who have taken up green deal finance with the number of people who have had an assessment and installed green deal measures. Once they sit down at their kitchen table, a surprisingly large number of people—thousands and thousands—elect to take all the savings immediately and install the measures.
Gregory Barker
British Gas alone has installed more than 10,000 green deal measures for customers who have elected to install them. Some 80% of people who have had a green assessment say that they have already installed measures, are currently installing measures, or are likely to do so.
Toby Perkins
Just like many other Government Members, the more the Minister spoke the less he said. Seven people in the Prime Minister’s constituency benefited from that.
Toby Perkins
Was it six? I got it wrong. The measure is a pitiful failure and to hold it up as an example of a Government success shows how little the Government know and how little they are doing.
In the few weeks since the Labour conference the Government have been in complete disarray on one of the central cost of living issues that we face. When I listened to the speech by the hon. Member for Morecambe and Lunesdale (David Morris) I was reminded of someone who thought that if we did anything to these powerful energy companies they might end up hurting us in return. Basically, we should just leave them alone, because if we did not they might up put up prices or not increase wages for his constituents. I was reminded of someone who thinks that the way to tackle a bully is not to tell anyone about what they are doing because the bully might get them after school. It was absolutely pitiful, and the hon. Gentleman’s constituents will have heard what he said—I am sure that they will be made aware of it—and they will know that he is someone who absolutely refuses to take their side or stand up to the big six.
When we hear Government Members say that we need to put pressure on the big energy companies while at the same time coming up with a host of risible reasons for not taking action, saying that that would be dangerous, we know that the Conservatives and Liberal Democrats are not the answer to this problem.
Prices are going up because when the wholesale price of energy increases the energy companies pass that on, but when it drops our constituents do not see a fall in their bills. If that sounds familiar to Government Members I would not be surprised, because it is precisely what the Prime Minister said when he was Leader of the Opposition. In Bedford in 2009, when he was still attempting to occupy the centre ground, he said:
“I think we all feel that when gas prices or oil prices go up, they rush to pass the costs onto us and yet when we read in the papers that the oil price has collapsed and the gas prices are coming down, we wait for a very long time before we see anything coming through on our bills”.
I could not agree more, and it is a shame that the Prime Minister does not say now what he did when he was attempting to be elected.
Only last month, Which? estimated that flaws in the market have left consumers paying £3.9 billion a year over the odds since 2010. We have a duty to our constituents to end this great rip-off. One-nation Labour has a long-term vision to do just that—not simply with the energy price freeze but with a suite of measures that will radically transform the market. There are three steps that will make a significant difference, including, first, separating the parts of the business that generate energy from the parts that sell to consumers. My hon. Friend the Member for Southampton, Test (Dr Whitehead) was excellent, as he always is, on the importance of this, setting out its real value. Secondly, we would introduce a simple new tariff structure and make sure that people over 75 always paid the lowest tariff. Thirdly, there would be a measure to abolish Ofgem, which has failed to stand up for consumers, and to replace it from January 2017 with a new energy watchdog with teeth.
The 42,000 households in my constituency cannot wait for those proposals to bear fruit. They need action now. They need a Prime Minister who is not strong on the weak and weak on the strong but who is brave enough to stand up to the energy companies and deliver a price freeze. An incoming Labour Government will legislate with immediate effect to make this happen and will put an average of £120 back into the pockets of every household in Chesterfield. Unfortunately, the response of the Prime Minister and the response that we heard from the Secretary of State was once again to stand up for the wrong people and to take the side of vested interest. It seems that the Conservatives will do anything to prevent the big six from having to reduce their profits.
Instead, the Prime Minister has suddenly turned on the evil of green taxes. As my hon. Friend the Member for Ynys Môn (Albert Owen) reflected earlier, green taxes are so evil that he told “The Politics Show” in 2006:
“I think green taxes as a whole need to go up”.
In 2006 he told “Newsnight” that
“we think green taxes should take a bigger share of overall taxes.”
So evil were these green taxes that his Government introduced 60% of the green levies currently imposed on energy companies. We all remember when the Prime Minister was the Leader of the Opposition and was attempting to present the modern face of Conservatism. He has certainly travelled a long way from “vote blue, go green”. He has shot the husky and simply told people to pull up their hoodie. He is not standing up on behalf of the people in my constituency.
The Prime Minister has not explained how, when he abolishes the green levies, the burden will move to general taxation. Where will the money come from? I do not believe the Government are going to increase taxes. That leaves one of two possibilities. Either it will go on to the deficit, which the Government have so singularly failed to eradicate in the way they promised, or they will reduce the budget for schools, hospitals, roads or other Government Departments. We have had nothing from the Secretary of State or Ministers about how they propose to fund those measures from general taxation. It was interesting that in the Secretary of State’s entire speech, he did not once mention the idea of getting rid of green levies and raising the money from general taxation. That spoke volumes about the extent of the disarray that the Government are in.
The issue is not just the impact on consumers. Labour is very much the party of small business. Our policy of an energy price freeze is an example of that. Annual energy bills for small businesses have gone up by an average of £10,000 since 2010. Small businesses will benefit hugely not just from the price freeze, but from a market that works for consumers. In addition, our plan to cut business rates for small business would mean an average saving of nearly £450 for 1.5 million business properties. These two policies demonstrate to small businesses that it is only Labour that will stand up on their side and cut their costs so that they can reinvest in new jobs and new products. Labour’s policy is good for consumers, good for business and good for the economy. I am proud to say that I will be supporting it and voting for it today.